Friday, February 06, 2009

MY PLEA TO THE GOP: STALL UNTIL TUESDAY - THAT'S A DAY AFTER GEITHNER WILL HAVE ANNOUNCED THE NEW BANK PLAN

NYTIMES:
After weeks of internal debate, the Obama administration has settled on a plan to inject billions of dollars in fresh capital into banks and entice investors to purchase their most troubled assets.

The new financial industry rescue plan, to be outlined in broad terms on Monday in a speech by the Treasury secretary, Timothy F. Geithner, will not require banks to increase their lending. That is despite criticism that institutions that already received money from the Troubled Asset Relief Program, or TARP, either hoarded it or used the funds to acquire other banks.

The incentives to investors could be in the form of commitments to absorb some of the losses from any assets they purchase, should their values continue to decline. The goal is to relieve the banks of their worst assets so that private investors might then provide more capital.

Officials hope that that part of the plan is not labeled a “bad bank” administered by the government, although they expect that some might call it that.

No matter what it is called, the government would assume some of the risk of declining assets at the heart of the economic crisis. But by relying on a combination of private investors and government guarantees, the administration hopes to reduce its exposure to losses and avoid the problem of having to place a value on assets that the institutions have been unable to sell.
  • THIS ANNOUNCEMENT WILL BOOST THE MARKETS, GLOBALLY - BIGTIME.
  • AND THAT WILL REDUCE THE PRESSURE TO PASS THE AWFULLY HUGE AND AWFULLY BAD PORKAPALOOZA "STIMULUS" BILL.
  • THIS WILL GIVE EVERYONE TIME TO FULLY VET THE BILL - AS IT SHOULD BE VETTED.

PLEASE WAIT!

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